Worldwide PC shipments totaled 76.3 million units in the first quarter of 2013 (1Q13), down -13.9% compared to the same quarter in 2012 and worse than the forecast decline of -7.7%, according to the International Data Corporation (IDC) Worldwide Quarterly PC Tracker. The extent of the year-on-year contraction marked the worst quarter since IDC began tracking the PC market quarterly in 1994. The results also marked the fourth consecutive quarter of year-on-year shipment declines.

Despite some mild improvement in the economic environment and some new PC models offering Windows 8, PC shipments were down significantly across all regions compared to a year ago. Fading Mini Notebook shipments have taken a big chunk out of the low-end market while tablets and smartphones continue to divert consumer spending. PC industry efforts to offer touch capabilities and ultraslim systems have been hampered by traditional barriers of price and component supply, as well as a weak reception for Windows 8. The PC industry is struggling to identify innovations that differentiate PCs from other products and inspire consumers to buy, and instead is meeting significant resistance to changes perceived as cumbersome or costly.

"At this point, unfortunately, it seems clear that the Windows 8 launch not only failed to provide a positive boost to the PC market, but appears to have slowed the market," said Bob O'Donnell, IDC Program Vice President, Clients and Displays. "While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the UI, removal of the familiar Start button, and the costs associated with touch have made PCs a less attractive alternative to dedicated tablets and other competitive devices. Microsoft will have to make some very tough decisions moving forward if it wants to help reinvigorate the PC market."

The impact of slow demand has been magnified by the restructuring and reorganizing efforts impacting HP and Dell. Lenovo remains a notable exception as it continues to execute on a solid "attack" strategy. Mid- and bottom-tier vendors are also struggling to identify growth markets within the U.S. Among the most vulnerable group of vendors are the whitebox system builders, which are undergoing consolidation that is affecting shipments as well as the distribution sector.

"Although the reduction in shipments was not a surprise, the magnitude of the contraction is both surprising and worrisome," said David Daoud, IDC Research Director, Personal Computing. "The industry is going through a critical crossroads, and strategic choices will have to be made as to how to compete with the proliferation of alternative devices and remain relevant to the consumer. Vendors will have to revisit their organizational structures and go to market strategies, as well as their supply chain, distribution, and product portfolios in the face of shrinking demand and looming consolidation."

Regional Highlights

United States – The U.S. market had another dismal quarter in 1Q13, contracting -12.7% year on year, with a drop of -18.3% compared to the fourth quarter of 2012. With total volume falling to 14.2 million, quarterly shipments reached their lowest level since the first quarter of 2006. With this latest figure, the U.S. is now in its tenth consecutive quarter of year-on-year contraction (excluding a brief moment of growth – less than 2% year on year – in 3Q11).

EMEA – As expected, Europe, Middle East and Africa (EMEA) remained constrained, posting a stronger double-digit decline than anticipated in the first quarter of 2013. Results fell short of expectations in the consumer segment as softness in demand persisted amid a continued shift to tablets and ongoing budget pressures. Meanwhile, the market response to Windows 8 and touch-enabled devices remained slow, leading to cautious sell-in from most vendors. Shipments in the commercial market remained constrained as predicted, following continued economic pressure and lack of major IT renewals.

Japan – PC shipments were in line with expectations in the first quarter. Some economic improvement is helping to support commercial replacement demand ahead of the scheduled end of support for Windows XP next year. However, consumer shipments remained very weak.

Asia/Pacific (excluding Japan) (APeJ) – PC shipments in APeJ declined sharply, dropping a record -12.7% year on year, the first time the region has experienced a double-digit decline. Although much of the earlier Windows 7 stock had cleared, a lukewarm reception toward Windows 8 hampered new shipments. China's inactivity contributed heavily to the decline, as public sector spending continued to be constrained.

Vendor Highlights

HP remained the top vendor, but posted a substantial double-digit decline in shipments after an aggressive fourth quarter kept growth flat during the holidays. HP's worldwide shipments fell more than -23% year on year in 1Q13, with significant declines across all regions, as internal restructuring continued to affect commercial sales. Although HP maintained its leadership position in the United States, the company saw U.S. shipments fall -22.9% from a year ago.

Lenovo remained second in global shipments and nearly closed the gap with HP. Lenovo continued to outpace the market, notably expanding shipments with its attack strategy. In the United States, Lenovo outperformed the market with double digit year-on-year growth compared to the market's double-digit contraction. Shipments in Asia/Pacific declined, however, keeping Lenovo's overall growth flat.

Dell saw shipments decline by more than -10% globally and -14% in the United States. The vendor continued to face tough competition and struggled with customer uncertainty about the direction of its restructuring. Nevertheless, the decline in shipments was smaller than the past few quarters, and its sales to Asia/Pacific returned to positive growth.

Acer Group continued to see substantial declines in shipments across regions. As the leader in Mini Notebook shipments, the vendor has been particularly exposed to the decline in these systems. Slow consumer and SMB growth has also taken a toll. In a sequential comparison, Acer's market share rose slightly to 8.1% in 1Q12 from 8.0% in 4Q12, halting its market share decline.

ASUS managed some growth in the United States, but saw a substantial decline in EMEA and Asia/Pacific. The company's substantial surge in Americas shipments in the second half of 2012 gave way to limited growth as demand weakened.

Apple fared better than the overall U.S. market, but still saw shipments decline as its own PCs also face competition from iPads.

Toshiba also saw shipments decline in the United States, but fared better than the overall market, benefitting somewhat from the restructuring of market leaders HP and Dell.

and gaming consoles and media boxes like the ROKU and on and on....The only thing new the PC market has had to offer recent times is how fast you can get ripped off ( Windows Vista, 7 and 8 and soon to be blue and 9 etc...etc...)....may not be true for PC geeks but that sure is true for most people...

More people getting into building PCs, as a hobby and as gamers after better performance, combined with a generally more computer-savvy public - it's no surprise nobody wants those pre-built machines with bargain bin components. Anyone who's smart enough to use and maintain their PC can easily learn how to build one, cheaper and better than any OEM, and with no bloatware to slow it down. The technically-challenged majority is more than happy with the dumbed-down experience afforded by tablets and smart phones, they were never really comfortable with their "complicated" desktop computers. And so it appears that desktop PCs are on the decline, but really people have just moved on, away from the crappy OEM boxes that are so ubiquitous in WalMart and other junk dealerships. If you look at the figures for all computing devices and components as a whole I'll bet there's no decline at all, just a shift in market focus.

That never stopped them before. I cant tell you haw many poor people I see with smart phones. Smart phones are the new crack

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This. Money isnt a problem. Visual image is.
People have long been tired getting ripped off by PC world, buying a junky PC at overinflated prices, then having to pay through the teeth for a yet more overpriced tech guy to come in and say they need to pour cash into their PC for incoherent reasons. Not tech savvy people are buying smart phones and tablets because they're popular, all the rage, and rarely need some guy to come in and repair it and replace parts for them.
Everyone else is doing the same, bar people like us who build with components.
The only people buying prebuild OEM PC's are businesses and schools now. Even they will buy less and less, with all the required software etc being built on an App for tablets etc, or educational software being readily (and cheaply) available for tablets.
OEM PC sellers have shot themselves in the foot because of inflated prices, and people arent taking it anymore. At least that's how it is in the UK.
Even my place of work doesnt buy OEM PC's, we built all 400 of our own.

Post PC era... bull****, all that cloud data, our personal data sharing is just a cultivated hype now, they say what we should believe and do[medieval church style played by big companies, no other difference really -Intel, M$, Apple, Google etc - screw you], it will blow up loud sooner or later and the systems will close down and return to our silly old standalone PC concept [slashing dragons with a bigger axe and hunting elves with bows , that's the human nature]

What do you expect? 4 year old PC's still perform same CPU wise as new ones.

Consoles cripple game industry... you need high performing GPU for few game titles, and also because the are inefficient lousy ports?

Why an upgrade, if there is no point really in it?

People should see performance multiplied by TWO at least to feel the difference, we are humans we like to feel not seeing plain numbers. Like SSD's do and slowly gain popularity as it increases productivity, while less staring in to screen and waiting for process to complete [wasting life] and actually do something. That is the main reason for upgrade!

There are no revolutionary UI, demanding one, like Vista did and it did right, to provoke people upgrading, because of eye candy and easy UI and FEATURES, that could actually speed up things we do. What M$ did with eight? Broke it, complicated it, they should have forked it like they do with server OS, but no! And the rest of without metro it is same as Seven, no major kernel changes, benefits from instruction sets it is still a plain NT6. My damn RAM is still unused most of time and the OS is so stupid that it even doesn't learn my OS usage behavior and it still is empty, despite it could boost everything up at no expense... I cannot understand really it, it acts same as from win95 times... Ok then RAM prices were huuuge... the market and possibility changes, bet the OS thinking principles are the same still for nearly 20 years...

So my opinion... M$ is the number one to blame for PC sales decline! Please say I am wrong, I would gladly hear a fresh thought about it.

Everyone could see this from a mile away: computers 4 years ago "powerful enough" for most common everyday tasks, smartphones and tablets cannibalising the bottom, shortage of change here and there, etcetcetc. I believe we are now in the new era of computing, where each computers actually last more than 6-7 years before becoming obsolete, with various other internet devices replacing it as the main source of entertainment.

The thing is this only looks at big name oem's, that being said most of the big OEM's sales are to the mindless plebs that walk into best buy and buy whatever's on sale because the salesman said so.
These people are either
A: still using the computer they bought a few years ago because they have no need to upgrade
B: using tablets smartphones etc because they can do everything with it that they would do on there pc on it

A lot of the Alienware/falcon northwest buyer crowd started to figure out that you can go to places like Microcenter and have them build you a "custom" pc for half the price of anything high performance bought from OEM.
Windows 8 isn't helping things either.

I'd say the declining PC market is the result of four factors that all tie together:

1. Just about every PC sold in the last 2-3 years is still sufficiently fast for almost all users.
Why would people purchase a new PC if the one they already have is plenty fast for all the tasks they use it for? While enthusiasts may want the latest and greatest hardware, the vast majority of users wouldn't think twice about upgrading as long as what they have can check Facebook.

2. The Global Economic Climate
Everyone knows that just about everyone is in the midst of a recession. Just about everyone is being more conservative with their money these days, and that means less spending on luxuries and non essentials, and that includes PCs. This point goes along with my first point in that, why would a person with little disposable income spend $300+ on an item they already have, for little to no increase in performance, if that's even what they care about.

3. Tablets
Tablets are cheap, tablets are cool, tablets do about 90% of what an average PC user uses their PC for. While tablets may seem underpowered and underwhelming to the average enthusiast, they are very appealing to cash strapped users that already have a PC sitting on a desk somewhere in their home, which once again ties in my previous points.

4. Smart Devices
While tablets are replacing many people's PC for daily usage, another trend that was mentioned in an earlier comment is smart devices. People no longer have to sit at a PC to have access to Internet based content. Smart TVs, Roku players, even gaming consoles are providing the cat videos the majority of users are looking for, but on a larger screen that's easier to view and share with family and friends.

Note I didn't mention Windows 8 directly as a factor for the decline of PCs. PC sales have been in a decline way before Windows 8 arrived. Windows 8 was meant to be a revival of the PC industry, but instead was just one more uninspiring upgrade for users with PC that can already do everything the latest and greatest PC can do. I do however see Windows 8 as a new start to the PC, one where eventually we will see a convergence of tablets and PC, more powerful, capable tablets, keyboard docks, wireless video streaming from tablet to TV, eventually all of this stuff will be enveloped under the umbrella of the "New PC" I would hope for our sake the enthusiast/gaming/pc building market will continue on as niche hobby, but like it or not, I think we are on our way to a convergent device that will fit the bill for just about everyone's needs.

Post PC era... bull****, all that cloud data, our personal data sharing is just a cultivated hype now, they say what we should believe and do[medieval church style played by big companies, no other difference really -Intel, M$, Apple, Google etc - screw you], it will blow up loud sooner or later and the systems will close down and return to our silly old standalone PC concept [slashing dragons with a bigger axe and hunting elves with bows , that's the human nature]

What do you expect? 4 year old PC's still perform same CPU wise as new ones.

Consoles cripple game industry... you need high performing GPU for few game titles, and also because the are inefficient lousy ports?

Why an upgrade, if there is no point really in it?

People should see performance multiplied by TWO at least to feel the difference, we are humans we like to feel not seeing plain numbers. Like SSD's do and slowly gain popularity as it increases productivity, while less staring in to screen and waiting for process to complete [wasting life] and actually do something. That is the main reason for upgrade!

There are no revolutionary UI, demanding one, like Vista did and it did right, to provoke people upgrading, because of eye candy and easy UI and FEATURES, that could actually speed up things we do. What M$ did with eight? Broke it, complicated it, they should have forked it like they do with server OS, but no! And the rest of without metro it is same as Seven, no major kernel changes, benefits from instruction sets it is still a plain NT6. My damn RAM is still unused most of time and the OS is so stupid that it even doesn't learn my OS usage behavior and it still is empty, despite it could boost everything up at no expense... I cannot understand really it, it acts same as from win95 times... Ok then RAM prices were huuuge... the market and possibility changes, bet the OS thinking principles are the same still for nearly 20 years...

So my opinion... M$ is the number one to blame for PC sales decline! Please say I am wrong, I would gladly hear a fresh thought about it.

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The first point is rubbist, and the reset of the post is barely coherent, but if I understand you correctly Windows 8 would be better if it used more resources? Yeeaaaahhhhhhhh right.

This. Money isnt a problem. Visual image is.
People have long been tired getting ripped off by PC world, buying a junky PC at overinflated prices, then having to pay through the teeth for a yet more overpriced tech guy to come in and say they need to pour cash into their PC for incoherent reasons. Not tech savvy people are buying smart phones and tablets because they're popular, all the rage, and rarely need some guy to come in and repair it and replace parts for them.
Everyone else is doing the same, bar people like us who build with components.
The only people buying prebuild OEM PC's are businesses and schools now. Even they will buy less and less, with all the required software etc being built on an App for tablets etc, or educational software being readily (and cheaply) available for tablets.
OEM PC sellers have shot themselves in the foot because of inflated prices, and people arent taking it anymore. At least that's how it is in the UK.
Even my place of work doesnt buy OEM PC's, we built all 400 of our own.

Click to expand...

Virtualization is ripping into the business and school/government pc business as well. Why by a slew of desktops with their hardware issues and have to support them when you can just setup vmware, citrix or even HyperV and run thin clients or even better use mobile devices to login to the full pc os on a virtual? Way cheaper, snapshots allow for almost instant restore options when the user fubars their crap, and you need less than half the tech crew to support them.

PC sales are getting hit from all sides. Just wait until the new consoles come out, then they'll truly be surrounded.

doesn't make sense for business, doesn't make sense for govt, doesn't make sense for average user, Only makes sense for media heavy jobs and Uber elite gamers. That essentially makes it a niche rather than the catch all it used to be.

The PC is dying, our Dell reps tell us that Dell will stop offering desktops soon...think about that. The company created out of a dorm room selling cheap pc's, the company that made it's living off of intel celeron "dude you're getting a dell" desktops will no longer be selling them.

Only in shape and size. This seemingly negative attitude you have need not be negative at all...PC computing is going through a badly-needed shift, and that is all.

BTW< I don't think your post was negative, but telling PC enthusiasts that the thing that they are enthusiastic about is going to disappear...will be taken as negative no matter how much positive spin you put on it.

The review posted yesterday is of a small, 8-inch x 8-inch x 3-inch miniPC that can do pretty much anything. THAT is the future of PCs...small, thin, lightweight clients for end users, with cloud storage. I was talking about this sort of implementation 10 years ago (literally 10 years ago, you can troll the internet for my posts back then), so to me, this is just the natural progression of things.

The first point is rubbist, and the reset of the post is barely coherent, but if I understand you correctly Windows 8 would be better if it used more resources? Yeeaaaahhhhhhhh right.

(that is probably not your point, but it looks like that)

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Actually that's why Windows server products work so well. They, by design, will use as much RAM as they possibly can. This is not by accident. Having a post graduate degree in computer software engineering, you will quickly understand that having your resources available in the fastest form of memory results in the quickest processing of operations. The previous poster's comments were on the right path. Having an O/S that does more than merely superfetch would be great. The problem is not much software today is written to take maximum advantage of multiple cores and high memory capacities. SQL server, Exchange etc. reap huge benefits from high capacity memory, high I/O, and high speed storage. The average desktop user won't come within a minute fraction of the I/O generated by this software. However, that doesn't mean the desktop user shouldn't benefit from some of the thinking used in this software.

So my opinion... M$ is the number one to blame for PC sales decline! Please say I am wrong, I would gladly hear a fresh thought about it.

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I agree, they are completely out of touch with their user base, their decision to force the moronic Metro on everyone was ill-advised, and at just the wrong time. They still think like they did 10 years ago, when what's needed is a leaner, more aggressive kernel optimized to leverage hardware performance. So they gave us an interface that's optimized for the semi-illiterate masses, effectively torpedoing any hope for real progress in OS technology from M$.